1. Field of the Invention
The present invention generally relates to a reward system and method for wheeled vehicles, and more specifically, to a way to encourage the return of a shopping cart to a cart return location.
2. Description of the Related Technology
Wheeled shopping carts are conventionally provided by supermarkets, discount stores and other retail stores for the convenience of shoppers such that relatively large loads of goods can be collected, paid for and then wheeled out to the shoppers vehicle for unloading. A few shoppers will voluntarily return a cart to a central cart return location, such as a cart corral. Typically, however, the shopper leaves the cart in the vicinity of where the vehicle is parked. The empty cart must then be collected by store personnel and returned to the store for subsequent use. Substantial costs may be incurred associated with the process of retrieving the carts from the far corners of the site and collecting them into a central cart corral or a cart line in front of the store. A typical store may spend from one to six person-years in the collection process, and incur additional indirect costs associated with injury and disability claims. Worldwide, labor costs of cart collection add up to millions of dollars.
Additionally, some carts may be removed from the store parking lot. For example, a shopper without a vehicle may use the cart to transport goods back to his home and then abandon the cart. This can result in permanent loss of the cart. Furthermore, thieves may intentionally abscond with carts for the purpose of later resale to other retailers. Loss of shopping carts results in substantial financial loss to the retailer, since each cart is a relatively expensive piece of equipment.
According to the Food Marketing Institute (FMI) in one recent year, U.S. retailers annually lost approximately 11% of their carts with a value of $185 million, plus another $117 million in cart retrieval expenses. Because it is common for shoppers to “borrow” carts to transport their purchases home or to a transit stop, retailers must contract for regular cart retrieval services. Retrieval contractors comb their neighborhoods several times per day or week, at substantial cost to the retailer. The total impact is typically thousands of dollars per site per year. Once off-site, carts are often taken great distances, experiencing worn wheels and other damage. Rough handling during the collection process often further damages those carts that are retrieved. Extra cleaning and repair that may be required following retrieval could easily add thousands of dollars of additional expenses per store per year. Furthermore, to compensate for carts that are off-site, retailers typically maintain excess cart inventories, often 10% to 20% over their actual need, to ensure that enough carts are available during peak shopping hours. At some sites, the total of all these costs may exceed $100,000 per site.
Numerous proposals have been made in the past for devices to deter shoppers or others from removing carts from the immediate vicinity or parking lot of a store. Such devices typically include some type of wheel locking mechanism which is activated when the cart crosses a boundary of some type around the perimeter of the parking lot or travels a fixed distance from a store exit. However, these concepts do not provide incentives to discourage removal of a cart from the lot or to return the cart to the cart corral.
One method increasingly used by retailers to encourage repeat business is a frequent shopper program, also known as a reward or loyalty program. In such a program, a customer is typically issued a card having a unique customer identification code. The card is issued after the customer provides identifying information and usually some demographic information to the issuing store. This frequent shopper or reward card may be of various types, such as magnetic stripe, bar-code, or smart card technology having a non-volatile memory (proximity, and so forth).
According to In-Store, the newsletter of In-Store Marketing & Business, a current survey of frequent shopper or reward program penetration shows that there are now more than 7,750 supermarkets in the United States that have card-based frequent shopper programs, which represents about 26% of all supermarkets. This is up from 19% (5,867 stores) of total United States supermarkets in the 1st Quarter of 1997. The growth in loyalty card programs is similar throughout the developed countries of the world. A supermarket is defined as a grocery store with more than $2 million in annual sales.
The use of these reward programs continues to grow at a rapid pace. In 1998, fifty chains with twenty or more stores and seventy-five retailers with fewer than twenty stores have or are in the process of rolling out frequent shopper programs. Over 72% of the frequent shopper store count is made up by chains with more than $2.0 billion of annual sales. The percentage of frequent shopper penetration in 1998 represented 22.5% of All Commodity Volume (ACV) in the United States, which is up from 17.4% in the first quarter of 1997. It is estimated that 3,600 additional supermarkets will add frequent shopper programs soon, which would mean that about 38% of all supermarkets will have a reward program. Similar growth in loyalty card programs may be anticipated throughout the developed countries of the world.
ACNielsen performs an annual “Frequent Shopper Programs” study. The ability to use a frequent shopper or loyalty card was cited as more important by card holders than every-day low pricing or customer service. When card holders initially joined their shopper card programs, savings was cited as the primary reason by nearly 75% of card holders, with check cashing the number two reason at 15%. Today, many card holders have had a frequent shopper card over 12 months, and savings continues to be the primary reason for card usage. Over 50% of the card holders are primarily looking for special deals on products. Although the most often cited reason for shopping in a particular store is still location, the ability to use a frequent shopper card ranked third in importance, next to location and store deals.
In 1998, 55% of households in the United States have at least one grocery store loyalty card. A similar ACNielsen study in 1997 showed that only 35% of households had a card. The highest percentage of card holders was found in Chicago, with 94% of households having at least one store card. Other top markets include Los Angeles, N.Y., Buffalo/Rochester and Charlotte, N.C.
A system and method is desired that would enlist the help of customers in the cart collection process. To accomplish this, such a system and method would elicit supportive behavior of a shopper by providing incentives to return a shopping cart to a cart return location. These incentives would provide a reward to the shopper for returning a shopping cart and to encourage repeat business. The system and method would thus provide direct benefits to both the customer and the store operator.
It is also desired to have a shopping cart return system that can be associated with a frequent shopper or rewards program. Such a cart return system would be able to integrate with the existing store infrastructure so as to minimize store expenses and not require customers to learn a totally new system or new procedure. A variety of different ways to sense the return of a cart, to obtain a customer identification, and to provide the reward are also desired.